GITEX Shopper showcases impact of convergence on electronics retailing

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By  Aaron Greenwood Published  December 1, 2006

The growing importance of GITEX Shopper & Consumer Electronics Expo and its impact on the traditionally IT-focused event that is GITEX Dubai is a by-product of the convergence of IT and consumer electronics (CE) technologies. More than 150 retailers were involved in this year’s event, which was staged in Dubai last month. Event organiser Dubai World Trade Centre (DWTC) reported total sales in excess of US$23 million, while leading GCC power retailers including Jumbo Electronics, Jacky’s Electronics and Plug-Ins, all reported strong gains compared to 2005. Their success pays tribute to DWTC’s claim that GITEX Shopper represents the largest retail platform for new consumer technologies in the Middle East. The fact that many of these retailers showcased diversified product portfolios also demonstrates to what extent the traditional boundaries separating the CE and IT sectors have been breached. The development of new CE products featuring traditional IT networking components, such as Wi-Fi, is creating a host of new commercial opportunities for companies involved in both sectors. It is also blurring the once-clear distinction between IT and CE products, which is fuelling increased competition in various product categories. A case in point is the MP3 player market, which is dominated by traditional consumer PC vendor Apple. Over the past 12 months, Apple has faced increased competition from CE companies such as Sony and Samsung, and minor threats from IT peripherals manufacturers including Creative and iRiver. This has also had a major impact on the retail sector, with portable devices including notebook PCs, cellular handsets and PDAs, being increasingly stocked by CE retailers. The introduction of software giant Microsoft to the market with its Zune portable media player is set to further blur the traditional boundaries separating the IT and CE sectors. While Zune’s limited features and comparatively cumbersome aesthetics mean it is unlikely to pose a major threat to the market dominance of iPod in the short term, of major importance is Microsoft’s decision to include WiFi connectivity as standard, which allows users to share music with other Zune players wirelessly. Microsoft argues that the inclusion of wireless connectivity represents the next major leap in consumer electronics product development. Indeed, this philosophy even extends to more mature and less likely product categories such as household appliances, which are being radically recast as a result of the development of home networking technologies. Overall, the convergence of IT and CE technologies spells good news for channel players and consumers alike, with new and innovative products captivating consumers and generating new commercial opportunities for technology developers.

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